1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Anna007 [38]
2 years ago
12

To raise operating funds, National Distribution Center sold its office building to an insurance company on January 1, 2021, for

$890,000 and immediately leased the building back. The operating lease is for the final 12 years of the building's estimated 20-year remaining useful life. The building has a fair value of $890,000 and a book value of $695,000 (its original cost was $1 million). The rental payments of $190,000 are payable to the insurance company each December 31. The lease has an implicit rate of 7%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
Required: 1. & 2. Prepare the appropriate entries for National Distribution Center on January 1, 2021 and December 31, 2021, to record the sale- leaseback and necessary adjustments. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Business
1 answer:
QveST [7]2 years ago
4 0

Answer:

1-Jan-21

Dr Cash $890,000

Dr Accumulated Depreciation $305,000

Cr Building $1,000,000

Gain On Sale of Building $195,000

1-Jan-21

Dr Right Of Use Assets $1,508,600

Cr Lease Payable $1,508,600

31-Dec-21

Dr Interest Expense $105,602

Dr Lease Payment $84,398

Cr Cash $190,000

31-Dec-21

Dr Amortization Expenses $84,398

Right Of Use Assets $84,398

Explanation:

1. & 2. Preparation for the appropriate entries for National Distribution Center on January 1, 2021 and December 31, 2021, to record the sale- leaseback and necessary adjustments

1-Jan-21

Dr Cash $890,000

Dr Accumulated Depreciation $305,000 ($1,000,000-$695,000)

Cr Building $1,000,000

Gain On Sale of Building $195,000

($890,000+$305,000-$1,000,000)

(To Record Lease)

1-Jan-21

Dr Right Of Use Assets ( $190,000* PVAF 7% for 12year)

($190,000*7.94) $1,508,600

Cr Lease Payable $1,508,600

(To Record The Lease Payable)

31-Dec-21

Dr Interest Expense ($1,508,600*7%) $105,602

Dr Lease Payment $84,398

($190,000-$105,602)

Cr Cash $190,000

(To Record First Lease payment)

31-Dec-21

Dr Amortization Expenses $84,398

Right Of Use Assets $84,398

(To Record Amortisation Expense)

You might be interested in
An internet consulting company uses its website to allow its corporate clients to obtain information, analyze data, and ask ques
FromTheMoon [43]
<span>this consulting company is using a b2b model.
B2b stands for business to business., it means that all the transactions that is made through this model will be done by a producer/company to another producer/company, usually b2b products took form in some sort of service that make it easier for another company to serve its customers.
</span>
6 0
3 years ago
Using the same scenario as in number 2, your interviewer tells you that the game costs $1 to play and it has an expected value o
Anastaziya [24]

Roll sum of 19 sum of 17 sum of 15 sum of 13 doubles other winnings $5 $3 $2 $1 $.5 $0.

<h3>What is Roll sum?</h3>

The 12-month rolling sum is the total of the previous 12 months. As the 12-month period "rolls" forward each month, the amount from the most recent month is added and the amount from the previous year is deducted. As a result, a 12-month total has been carried forward to the new month.

Cumulative sums, often known as running totals, are used to show the total sum of data as it grows over time (or any other series or progression). This allows you to see the entire contribution of a specific measure across time.

The total number of possible outcomes is 36, which is equal to the total number of the first die (6) multiplied by the total number of the second die (6).

To know more about Roll sum follow the link:

brainly.com/question/2264527

#SPJ4

7 0
2 years ago
Pasadena Candle Inc. budgeted production of 730,000 candles for the January. Wax is required to produce a candle. Assume 13 ounc
Olin [163]

Answer:

Direct material budget (in pounds)= 588,125

Direct material budget ($)= $941,000

Explanation:

Giving the following information:

Production= 730,000 candles

Direct material required for each unit:

13 ounces of wax

The estimated January 1 wax inventory is 18,600 pounds.

The desired January 31 wax inventory is 13,600 pounds.

Candle wax costs $1.60 per pound.

The direct material purchases are determined by the production requirements, the beginning inventory, and the ending inventory.

First, we need to calculate the amount of wax for the period:

Production= 730,000 candles*13 ounces= 9,490,000 ounces

In pounds= 9,490,000/16= 593,125 pounds.

Direct material budget (in pounds)= Production for the month + ending inventory - beginning inventory

Direct material budget (in pounds)= 593,125 + 13,600 - 18,600= 588,125

Direct material budget ($)= 588,125*1.6= $941,000

5 0
2 years ago
Can you breifly explain why stockholders' investment and revenues increase stockholders' equity, while dividends and expenses de
Scilla [17]
From an accounting standpoint, stockholders' investment and revenues increase the assets of the company without adding to the liabilities. Therefore according to the equation (A = L + E), equity must increase.

Similarly, issuing dividends and paying expenses pays cash out of the company, which decreases assets without changing liabilities. Therefore equity must decrease.

Another way to think of it is: what contributes to the company's profit and/or value, and what decreases these things? Well, revenues and people investing in the company are good (and therefore good for stockholders), and giving cash out and paying expenses are costs to the company (and therefore decrease value for stockholders).
5 0
3 years ago
Kyle is a strict boss. He is more concerned about the successful execution of tasks than the wellbeing of his employees. As a re
abruzzese [7]

Answer:

The answer is option (C) authority-compliance style.

Explanation:

The authority-compliance style In the context of the Blake/Mouton leadership grid describes when managers or bosses are overly concerned about the effectiveness with which their employees or subordinates get work done without regard for the well being of such employees.  

This kind of dictatorial management style is due to the fact that a manager or boss believes that the needs of his/her subordinates or employees are relatively unimportant when compared to achieving success or getting work effectively done.

7 0
2 years ago
Other questions:
  • Which of the following fees would likely be the highest. A.Atm Fee. B.Overdraft fee C.Mounthly service fee. D.Account transfer f
    5·2 answers
  • 54) Marika is a senior journalist at a news agency. She goes on a temporary leave for six months and travels around different pa
    6·1 answer
  • Mediocre economists often consider only the immediate apparent effects of a change, whereas a good economist will also consider
    10·1 answer
  • Coltrane Company has a $5,000 note payable that is paid in $1,000 installments over five years. How would the portion that must
    13·1 answer
  • __________ includes considering employee interactions with customers to ensure they are consistently delivered and experienced,
    11·1 answer
  • A development planning system primarily focuses on developing knowledge sharing networks to help trainers and managers reach emp
    15·1 answer
  • The owner of billy joe's barbecue is looking at his advertising, sales promotion, and publicity programs. he is reviewing the co
    8·1 answer
  • The materials manager of a warehouse is given a new product line to manage with new inventory control procedures. Which of the f
    7·1 answer
  • The following information is available for Quality Book Sales's sales on account and accounts receivable:
    15·1 answer
  • Select all the correct answers.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!